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Seed Co ordered to pay $1.1 million for breach of contract

HARARE – Zimbabwe’s High Court ordered Seed Co, a leading seed breeder listed on the Zimbabwe Stock Exchange, to pay US$1.1 million to Credcorp Investments, a seed crop production company, for breaching a contract in the 2018/19 season.

Credcorp sued Seed Co for failing to deliver the agreed amount of soya bean, sugar bean, and sorghum seed crops grown on its four farms, despite receiving full funding from Credcorp for the production costs and the parent seed.

Seed Co admitted to selling some of the seed to third parties, a practice known as “side marketing”, but claimed it had reached a settlement with Credcorp in September 2019, which involved paying $364,265.62 as full and final settlement.

Credcorp disputed this, saying the payment was only for the 44.7 tonnes of sugar bean seed that Seed Co had delivered, and that the seed breeder still owed them for the missing seed and some centre pivots.

The court ruled in favour of Credcorp, finding that Seed Co had no evidence to support its claim of ownership of the seed or the settlement agreement. It also found that the meeting minutes showed that the parties had treated the missing seed and the outstanding debt as separate issues.

Justice Joseph Mafusire ordered Seed Co to pay Credcorp US$1,014,483, or the equivalent in local currency, with interest from the date of judgment until full payment. He also ordered Seed Co to pay the legal costs of the lawsuit.